Bitcoin

Mt. Gox Bitcoin Billions Are Being Refunded — How We Got Here

Published

7 months ago

14 July, 2024

Mt. Gox Bitcoin Billions Are Being Refunded — How We Got Here

Extinct Bitcoin Cryptocurrency exchange Mt. Gox has been preparing to pay back creditors, more than a decade after the company went bankrupt. In recent weeks, the company has been preparing to return billions in Bitcoin to users, and recently said it has begun making some of those payments.

While this is cause for celebration for impacted users, it has also raised concerns in cryptocurrency markets. This is because many market participants expect the refunded Bitcoin to be immediately sold by creditorsas they had been broke for over 10 years, waiting patiently as the price of Bitcoin skyrocketed during that time.

But a decade is a long time, and the throngs of crypto users who have entered the industry in recent years may not be familiar with the infamous story of Mt. Gox. How did it go bankrupt, and how will Bitcoin refunds work? Here’s what you need to know.

What was Mount Gox?

Mount Gox was the largest in the world Bitcoin Exchange at one point. Based in Tokyo, the company was estimated to be responsible for 70% of Bitcoin trading volume in 2013. Mt. Gox CEO Mark Karpeles said Reuters in a now deleted report that the exchange received $5 million to $20 million in incoming transfers every day.

Launched in 2010, the site was originally an online marketplace for trading physical Magic: The Gathering cards; with Mt. Gox being a shortened version of “Magic: The Gathering Online Exchange.” Soon, the site added the ability to exchange cash for Bitcoin, effectively putting card trading on hold for good.

Exchange employees had the option to be paid partially in Bitcoin, but Karpeles said he stressed that one should not invest “more than one can afford.”

Bitcoin was extremely new at the time. It was launched in 2009, but it wasn’t until 2010 that trading really began. Then, in 2013, the cryptocurrency started the year valued at $13, rising to US$1,100 by the end of the year. But with this rise to popularity of Bitcoin regulatory nightmares have emerged for the world’s largest exchange.

How did Mt. Gox go bankrupt?

In the summer of 2013, Mt. Gox was charged by the U.S. Department of Homeland Security with failing to register as a “money transmitting business.” As a result, $5 million in Mt. Gox funds seized. Later in the year, the exchange partner Coin lab sued Mt. Gox for allegedly failing to fulfill the terms of the agreement.

In February 2014, the exchange revealed that it had been the target of years of unnoticed hacks. Malicious actors were able to edit transaction IDs due to a Bitcoin Vulnerability so-called “transaction malleability”, which has since been addressed through Resolution 2017 SegWit Soft Fork. The vulnerability allowed criminals to manipulate the exchange without its knowledge, apparently for years, and steal customer funds all the while.

As a result, 850,000 Bitcoin were lost — almost 7% of all Bitcoin that existed at the time. It was worth it 475 million dollars at the time, but at today’s rate that would be worth more than $49 billion.

When suffering the attack, the the exchange went offlinecausing Bitcoin Price fall sharply. Investors were angry and demanded answers. Karpeles then said the exchange would “find a solution.”

Ultimately, that solution was to file for bankruptcy, citing liabilities of $64 million while having just $38 million in assets — a difference of $28 million. The company had 127,000 creditors in the bankruptcy, according to a Reuters Reportof which only 1,000 were based in Japan.

The Japanese bankruptcy filing then stated that Mt. Gox owed creditors $63.5 million. But the company wasn’t even halfway to getting that amount of money, as $5 million of its assets were held by CoinLab as part of its ongoing case at the time. Another $5.5 million was being held by the U.S. Department of Homeland Security.

“We will make every effort to ensure that crimes are punished and damages are recovered,” Mt. Gox said later. he said.

Explanation about creditor refunds

In 2023, the US Department of Justice accused two Russian citizens with “conspiring to launder approximately 647,000 Bitcoins from their Mt. Gox hack,” which happened in 2011. In the process, 140,000 Bitcoins were recovered—or more than $8 billion at today’s prices.

Now, more than a decade after the stock market crash and after a series of term extensionsMt. Gox creditors are entitled to a refund. According to a Note of June 24thcreditors will start receiving payments in Bitcoin and Bitcoin Cash.

“We have taken the time to ensure safe and reliable repayment to creditors, including technical solutions for safe repayments, compliance with financial regulations in each country, and discussion of repayment arrangements with cryptocurrency exchanges,” Mt. Gox Rehabilitation Administrator Nobuaki Kobayashi said in the statement.

Since then, Mt. Gox moved billions of dollars value of Bitcoin across wallets as it prepares to execute refunds ahead of the October 31 deadline. At the time of writing, a Arkham Intelligence identified that the Mt. Gox wallet contains over $8 billion worth of Bitcoin.

Mt. Gox began refunds on July 5, according to a note of the rehabilitation trustees, while noting that the process will take time to confirm all details of eligible creditors. “We ask eligible rehabilitation creditors to please wait a little while,” the note reads.

Edited by Andre Hayward

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Bitcoin

What to watch for in the markets

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Photo: Andrew Harnik (Getty Images)

After witnessing one of the largest global IT outages on record, affecting the travel, finance and healthcare sectors worldwideThis week is set to see more political drama, events, and earnings reports from tech giants.

Donald Trump’s ‘Lovefest’ Sets Jamie Dimon Up for Consideration for Treasury Secretary Job

Let’s take a look at what awaits us:

Major companies will release their earnings reports

Major tech companies and others will release their earnings reports this week, paving the way for what the second half of 2024 will look like.

Monday

Verizon will report earnings before the start of operations.

Tuesday

Coca-Cola, Comcast and UPS are all set to report earnings before the market opens.
Tesla will report earnings in the morning, while General Motors will report earnings in the evening.
Alphabet and Visa will report results after the market closes.

Wednesday

AT&T will release its report before the market opens.
Ford and Chipotle will report earnings after the market closes.

Thursday

Earnings reports from AstraZeneca, American Airlines and Southwest Airlines will be released before the market opens.

Trump to speak at Bitcoin conference

Presumptive Republican presidential nominee Donald Trump will speak at the next Bitcoin Conference in Nashville, Tennesseewhich is scheduled for July 25-27. While this is the first time a presidential candidate will attend the conference, it has sparked a debate over whether the crypto-friendly Trump will receive support from the crypto community in the upcoming election.

In addition to Trump, independent presidential candidate Robert F. Kennedy Jr. will also discuss crypto during the conference. Crypto advocates such as ARK Investment’s Cathie Wood, MicroStrategy’s Michael Saylor, and whistleblower Edward Snowden are among some prominent names who will be participating in the conference.

Ether ETFs are on the way

New Ether Spot ETFs are set to begin trading on Tuesday, July 23. Much like the spot Bitcoin ETFs, these ETFs will allow investors to buy the second most popular cryptocurrency like stocks. BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton, and Invesco/Galaxy Digital are all set to offer Ether ETFs. Crypto asset manager Bitwise predict that trading in the Ether ETF will drive the price of Ether higher, potentially surpassing $5,000.

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Bitcoin

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Bitcoin miners and cryptocurrency companies that have been blocked from going public in the U.S. could ultimately be the biggest winners in the digital asset world under a second Donald Trump presidency. Foreign companies at risk of losing market share could end up being the biggest losers.

That’s the view that’s taking hold among market participants and observers in the wake of the former president’s growing embrace of cryptocurrency as his chances of election grow. survey released Thursday by CBS News showed Trump with the majority — 52 percent — of likely voters in his likely November rematch with President Joe Biden.

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Bitcoin

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Cryptocurrency investor Chris Burniske says Bitcoin (BTC), Ethereum (ETH), Solana (SUN) and the cryptocurrency market in general seem poised for a run.

Former Head of Cryptocurrency at ARK Invest account his 292,200 followers on social media platform X that several catalysts are aligning, suggesting that digital asset markets are on the verge of a bull run.

According to Burniske, a partner at venture capital firm Placeholder, the highly anticipated launch of Ethereum-based exchange-traded funds (ETFs), Republican presidential candidate Donald Trump speaking at an upcoming Bitcoin event, and the current state of the BTC, ETH, and SOL charts all suggest significant optimism for the cryptocurrency markets.

“With ETH ETFs set to go live, Trump speaking at The Bitcoin Conference, and BTC, ETH, and SOL charts looking [they do] (while stocks are weak), it’s hard to imagine a world where we don’t ship next week.”

Reuters recently reported that preliminary approval for ETH ETFs has been granted as the Bitcoin Conference is scheduled to take place from July 25-27.

BTC, ETH, and SOL are trading at $67,333, $3,528, and $174 at the time of writing, respectively.

The venture capitalist too provides an update on his prediction that the total crypto market cap will eventually hit $10 trillion. According to his chart, the path to $10 trillion is currently “23%” complete, as it sits around $2.2 trillion.

Source: Chris BurniskeX

Earlier this month, Burniske he said in an interview with Real Vision CEO Raoul Paul that he has his eye on the Move ecosystem, which was originally built by social media giant Meta and then used to develop layer 1 blockchains Sui (IUE) and Apts (APT).

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Bitcoin

Here’s the next target for BTC before bulls can hold out for $70K

Published

6 months ago

21 July, 2024

SatoshiTimes Staff

Here’s the next target for BTC before bulls can hold out for $70K

Bitcoin’s recovery is going well, and the market is seemingly poised to create a new all-time high in the near term.

Technical analysis

Per NegotiationRage

The daily chart

As the daily chart shows, the price of Bitcoin has been rising since it broke above the 200-day moving average.

The market has also reclaimed the $60K and $65K levels and is moving towards the $68K resistance zone, which could be the last hurdle before creating a new all-time high. With the RSI also indicating that the price has clear bullish momentum, it could be just a matter of time.

Source: TradingView

The 4-hour chart

Looking at the 4-hour chart, it is evident that the price has been rising rapidly since breaking the downtrend line to the upside. The market also broke the $65K resistance level with momentum, turning it into a support.

While almost everything points to a new record high in the coming weeks, there is one worrying sign. The RSI is showing a clear bearish divergence between recent price highs, which could indicate a correction or even a reversal in the near term.

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Cryptocurrency Charts by TradingView.

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